- Ethereum plunged 23.6% to $2,368 amid trade war fears, and major altcoins lost 15% to 30% in 24 hours.
- Ethereum saw $475.72M in long liquidations, and open interest dropped 27% to $23.36B, signaling extreme bearish sentiment.
- Whales accumulated 35,494 ETH ($88M), with $326.7M withdrawn from exchanges, hinting at a potential rebound.
Ethereum’s price plunged to a five-month low of $2,300 on Monday morning in Asia as fears of a global trade war rattled investors. Ethereum fell 23.6% to an intraday low of $2,368 on February 3. However, cryptocurrency prices tumbled, with Ethereum underperforming Bitcoin. Major altcoins, including XRP, Solana, Dogecoin, and Cardano, suffered losses ranging between 15% and 30% in the last 24 hours.
Massive Liquidations and Bearish Market Sentiment
Ethereum experienced its largest liquidation event in two years, with $475.72 million liquidated from long positions and $127.78 million from shorts within 24 hours. The open interest in Ethereum’s futures market plummeted by 27% to $23.36 billion, while its funding rate fell to levels last seen during the March 2020 COVID crash, signaling extreme bearish sentiment.
Ethereum’s price broke key support levels at $3,000, $2,800, and $2,650, confirming a downward trend. The decline extended to $2,120 before a slight rebound above $2,300. The price is now trading below $2,800 and the 100-hourly Simple Moving Average, with resistance forming at $2,770 and $2,900. A break above $3,000 could spark a short-term rally.
Another decline could occur if Ethereum fails to clear the $2,600 resistance. Key support levels are near $2,320 and $2,250, with a breakdown below $2,120 potentially leading to a further dip toward $2,000 or even $1,880 in the near term. The market remains highly volatile as uncertainty persists.
Ethereum Whale Accumulation Signals Possible Recovery
Despite the sell-off, signs of accumulation have emerged, indicating potential recovery. Investors have withdrawn $326.7 million worth of ETH from exchanges over the past three days, suggesting a shift toward long-term holding. Whale activity has also intensified, with a notable purchase of 35,494 ETH worth nearly $88 million amid the price drop.
Onchain Lens reported further whale purchases of $1 million worth of ETH, hinting at renewed confidence in the asset. Analysts believe ETH could see a short-term bounce toward $2,700, driven by technical factors and temporary relief in market sentiment. However, further downsides remain possible if global trade concerns worsen.
Crypto trader MaxBecauseBTC highlighted that Ethereum’s recent liquidation event was the largest in over two years, comparable to the March 2020 COVID crash. He suggested long-term holders may be rewarded for staying invested despite the current market turmoil. Felix Hartmann of Hartmann Capital echoed this sentiment, stating that forced selling has led to price dislocation.
Mechanism Capital partner Andrew Kang suggested ETH might be oversold, with a potential rebound to $2,700. The market’s next move depends on whether ETH can hold key support levels or if further downside risks materialize, shaping its short-term trajectory in response to ongoing macroeconomic pressures.
Read More: Can Ethereum (ETH) Break Out Of Its Short-Term Wedge Pattern?
